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Sensex ends 127 points higher; Nov IIP, Dec CPI eyed

Benchmark share indices ended higher, amid a choppy trading session, led by financials ahead of key economic data due for release later today and IT major Infosys after it posted better-than-expected third quarter earnings.

The 30-share Sensex ended higher by 127 points at 27,585 and the 50-share Nifty gained 39 points to close at 8,323.

The broader markets outperformed the benchmark indices- BSE Midcap and Smallcap indices gained by nearly 1%.

The market breadth in BSE ended firm with 1,647 shares advancing and 1,259 shares declining.

The government is scheduled to release index of industrial growth for November and consumer price inflation for December later today.

After an unexpected contraction the previous month, India’s industrial production is likely to have seen a marginal improvement in November 2014. The index of industrial production (IIP) for the month is expected to show some recovery.

On the inflation front, the consumer price index (CPI) moderated to 4.4% in November. But this was on the back of a high base of 11.2% in the same month last year, implying the decline should be viewed with caution.

Though the recent moderation in inflation has created room for a moderation in the policy rate, the Reserve Bank of India has so far resisted from doing so, saying the easing in inflation is transitory in nature and could reverse.

Further, foreign portfolio investors (FPI) sold shares worth a net Rs 297.99 crore on Friday, as per provisional data.

At 3:30 PM, the rupee was trading at 62.23 per dollar vs previous close of 62.31 for the fourth consecutive session.

GLOBAL MARKETS

The Nikkei rose for a third day on Friday on growing confidence in the U.S. economy and hopes of aggressive stimulus steps in Europe, while Fast Retailing Co rose after reporting strong quarterly profits.

The Nikkei advanced 0.2% to end at 17,197.73 after dipping into negative territory earlier. For the week, it dropped 1.5%. The broader Topix added 0.2% to 1,380.58, and the new JPX-Nikkei Index 400 gained 0.2% to 12,495.99.

Index-heavy Fast Retailing gained 0.8% and contributed a hefty 40 points to the benchmark Nikkei index after reporting strong first quarter profits.

The US dollar took a dip on Monday as Asian investors caught up with a benign payrolls report and the subsequent slide in Treasury yields, while oil prices showed no sign of escaping their downward spiral.

Share markets were mostly lower following a soft finish on Wall Street though sentiment was supported by speculation the Federal Reserve would be patient in tightening policy given the weakness of wages apparent in the jobs numbers.

SECTORS & STOCKS

BSE FMCG, Bankex, Power, Capital Goods and IT indices gained between 0.5-1.6%. However, BSE Metal and Oil & Gas indices were down 1-2%.

The main gainers on the Sensex were HUL, L&T, Infosys, HDFC, ICICI Bank, BHEL, Axis Banka and SBI.

Shares of fast moving consumer goods (FMCG) major Hindustan Unilever (HUL) rallied nearly 4% to Rs 897, extending its past five-day’s gain, recording its sharpest rally in 20-months.

Infosys extended gains and surged 2% after the IT major last week announced third quarter earnings which beat street estimates.

Banking shares ended higher by up to 6% on the NSE ahead of retail inflation and IIP data to be released later in the day.

Tata Motors ended marginally positive. Tata Motors owned Jaguar Land Rover (JLR), UK’s premium luxury car manufacturer today announced that it plans to create 1,300 new jobs at its UK plant as it plans to add new Jaguar models to its product portfolio

On the losing side, Coal India declined over 4.5%. Media reports suggest that the government is planning to reduce its stake in Coal India by 10%.

Bharti Airtel lost around 2%. Media reports suggest that the Supreme Court today refused to grant a stay on proposed auction of spectrum allocated to Bharti Airtel.

Oil shares were under pressure on further decline in crude prices. RIL lost 2% while ONGC and GAIL declined 1% each. Reliance Industries Chairman Mukesh Ambani announced Rs 100,000 crore investments across businesses in the next 12-18 months and said India was on the path to become the world’s fastest growing economy.

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